BAFS seeks low rates from AOT at Don Muang

SET-listed Bangkok Aviation Fuel Services Plc, the country's largest jet-fuel provider, is set to negotiate with Airports of Thailand Plc (AoT) to reduce the fee it will have pay AoT once Don Muang Airport reopens. ''It's quite certain that the reopening of Don Muang will affect us, at least in the short term, since we have to pay AoT fees for using its fuel pipelines underneath the airport and other services on top of the regular contractual payments for its services at Suvarnabhumi Airport,'' said M.R. Supadis Diskul, managing director of Bangkok Aviation Fuel Services (Bafs).

He said Bafs had already invested more than four billion baht in setting up service facilities at Suvarnabhumi. As a result, it will try to negotiate with AoT on the fees at Don Muang.

Before Don Muang was closed, Bafs paid AoT 87 million baht a year.

''We will negotiate with AoT for a possible cut in the rate or at least for keeping it at the level before Don Muang was closed,'' he said.

M.R. Supadis said it had not been concluded yet how much Bafs would charge airlines for providing the refuelling service at the old airport. However, the charge should not be lower than the current rate.

Presently, Bafs maintains a small operation at Don Muang to service charter flights and private jets, with refuelling volume of up to 40,000 litres per day. It charges six US cents per gallon, higher than the five cents charged at Suvarnabhumi.

He said the company did not need to invest more to fund operations after the reopening of Don Muang.

He said he agreed with the government's decision to reopen Don Muang because more and more problems had been found at Suvarnabhumi and there was no way of knowing when they would be resolved.

''For the first time in almost 10 years, the aviation refuelling volume at Suvarnabhumi outpaced that of Singapore's national airport in December last year, at four billion litres,'' he said. ''As a result, Thailand should not allow the problems plaguing Suvarnabhumi to stop the fast development of the country's promising air-transport sector.''

M.R. Supadis said the company was reviewing its sales volume projection by taking into consideration the problems at Suvarnabhumi and the reopening of Don Muang.

Bafs shares (BAFS) closed yesterday on the SET at 10.40 baht, down 10 satang, in trade worth 1.96 million baht.

 

Source: Bangkok Post by Soonruth Bunyamanee
Friday February 09, 2007